FB Update

FB looks to me to be ready for a bit of a pullback, I suspected we may see an upside head fake and in my last update today I suspected a pullback. I know at least one of our members used that information to cash out on June calls and is looking for an opportunity to add July Calls in to a pullback, he used the head fake breakout I said I thought was likely as the price pattern was too obvious to sell in to some strength. I don't view any of this as effecting the bigger picture in FB (by bigger I mean  move up of some significance before the next leg down).

Lets take a look...

Here's today's intraday symmetrical triangle, for technical traders this suggests an upside breakout, but as we see so often these obvious technical price patterns are manipulated more often than not, especially in a closely watched stock and a clean pattern like that. The yellow box shows the head fake breakout, at least that's what it appears to be.

 There are tow common pullback areas early in a new signal on this screen, usually the first several pullbacks are to the yellow 10-bar m.a (remember this is a 60 min. chart), then subsequent pullbacks are a bit deeper to the 22 bar m.a. in blue. I made a mistake in coloring RSI red, it should be white meaning the long signal is still in effect. The red box on the price window shows a probable pullback area that is around the 22 bar as well as the inverse H&S pattern's neckline (now support).

 The 1 min chart positive on Friday at the 1 p.m. lows and FB heads higher and a negative divergence in to the breakout of the intraday triangle.

 The 5 min chart positive for more than a week, the uptrend line which if it is hit, it is still within the Trend Channel. These are shorter term intraday or day to day moves.

The 60 min chart is now leading positive at a new high, above even where FB started trading on the 18th (28 % lower from the 18th's close), so this is a significant signal. I'd be using the shorter term 1-5 min timeframes to set up tactical entries, the strategic view at least for the near term over the next several weeks, looks very bullish for FB.

No changes to the options model portfolio Call positions in FB.